Latest Cato Research on PovertyIndividual Liberty, Free Markets, and Peacehttp://www.cato.org/
enamast@cato.org (Andrew Mast)webmaster@cato.org (Cato Webmaster)Wed, 28 Jan 2015 15:48:51 -0500Wed, 28 Jan 2015 15:48:51 -0500The Psychology of Pessimismhttp://www.cato.org/publications/catos-letter/psychology-pessimism
http://www.cato.org/publications/catos-letter/psychology-pessimismWed, 28 Jan 2015 15:44 ESTLatest Cato Research on PovertySteven PinkerPope Francis, Neither a Marxist Nor an Economisthttp://www.cato.org/publications/commentary/pope-francis-neither-marxist-nor-economist
Marian L. Tupy
<p>Last week Pope Francis defended himself against the charges of Marxism, explaining that caring for the poor is at the heart of Christian teaching. The pope is right. Caring about the poor does not make one a Marxist. By the same logic, defense of the free market does not make one oblivious to the plight of the less fortunate.</p>
<p>Citing excerpts from a book by two Italian journalists entitled “This Economy Kills,” the pope notes “that globalization has helped many people to lift themselves out of poverty, but it has condemned many other people to starve. It is true that in absolute terms the world’s wealth has grown, but inequality and poverty have arisen. We cannot wait any longer to resolve the structural causes of poverty in order to cure our society of an illness that can only lead to new crises.”</p>
<p>While it’s true that incomes were more equal for most of human history, they were terribly low. Two thousand years ago, the gross domestic product per person in the most advanced parts of the world hovered around $3.50 per day. About 1,800 years later, that was still the global average. The Industrial Revolution uprooted old feudal social structures and agrarian subsistence economy in Western Europe, thus setting the stage for the spread of representative government and material abundance. Poverty is not new. Prosperity is.</p>
<blockquote class="pullquote right">
<p class="pq-quote"><span class="open-quote">“</span><span class="pq-body">Blaming the free market for poverty isn’t factual.”</span></p>
</blockquote>
<p>Writing in the mid-1800s, Karl Marx astutely observed the monumental changes around him. As he wrote in “The Communist Manifesto,” “The bourgeoisie, by the rapid improvement of all instruments of production, by the immensely facilitated means of communication, draws all, even the most barbarian, nations into civilization. It has created enormous cities, has greatly increased the urban population as compared with the rural, and has thus rescued a considerable part of the population from the idiocy of rural life.”</p>
<p>Marxthought of communism as an improvement of capitalism that would benefit yet more people. It was not and it did not. The practical application of Marxist doctrines — nationalization of industry, collectivization of farms, abandonment of competition and the profit motive, resulted in economic disaster. In 1991, when the Soviet Union collapsed, an average American lived seven years longer and earned 151 percent more (adjusted for purchasing power parity) than an average citizen of the USSR.</p>
<p>Unlike his Soviet counterpart, the average American could freely state his opinions, worship the deity of his choosing, associate with anyone he pleased and travel wherever he liked. He did not have to worry about arbitrary arrest and unlawful incarceration. Most importantly, he did not have to worry about becoming one of 100 million people who died at the hands of the communist governments during the course of the 20th century.</p>
<p>The link between central planning (as practiced by communist, socialist and fascist governments throughout history) and mass repression is near automatic. As the Austrian economist Friedrich Hayek noted, the more obvious the failings of central planning become, the more force is needed to keep the people from rebelling against central planning. That is precisely what took place in Salvador Allende’s Chile and Daniel Ortega’s Nicaragua, and is happening in Nicolas Maduro’s Venezuela and Raul Castro’s Cuba today.</p>
<p>One would have expected an Argentinian pope vigorously to condemn the last two socialist dictatorships in Latin America. Instead, Pope Francis keeps on firing broadsides against the free market. It is here that the pope’s assertions are least comprehensible, for all available evidence points to a link between globalization (economic liberalization at home and free trade abroad) and massive reduction in global poverty.</p>
<p>According to the World Bank, some 1.9 billion people lived on less than $1.25 a day in 1990. Twenty years later, only 1 billion people lived in extreme poverty. The poverty rate dropped from 36.4 percent to 14.5 percent. The Brookings Institution’s Laurence Chandy estimates that if developing countries continue to grow at their current rates, the number of poor people will decline to 200 million in 2030. In his words, “poverty reduction of this magnitude is unparalleled in history: never before have so many people been lifted out of poverty over such a brief period of time.”</p>
<p>By returning the focus of the Church to the plight of the poor, the pope has become much loved and admired. His prestige and influence is commensurate with his humanity and humility. But with great influence comes great responsibility. In the context of the global struggle against poverty, the pope ought to know and say that the free market is a friend of the poor — not their enemy.</p>
http://www.cato.org/publications/commentary/pope-francis-neither-marxist-nor-economistSun, 18 Jan 2015 09:16 ESTLatest Cato Research on PovertyMarian L. TupyMichael D. Tanner discusses food stamp benefits on WWL's First News with Tommy Tuckerhttp://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-food-stamp-benefits-wwls-first-news
http://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-food-stamp-benefits-wwls-first-newsFri, 09 Jan 2015 12:52 ESTLatest Cato Research on PovertyMichael D. TannerProperty Rights of the Poor Need to be Recognized in Developing Countrieshttp://www.cato.org/publications/commentary/property-rights-poor-need-be-recognized-developing-countries
Peter F. Schaefer, Clayton Schaefer
<p>Although most economists agree that secure property rights contribute fundamentally to economic growth and broad-based prosperity, more than a billion households in poor countries still live without secure, documented, publicly registered and tradeable rights to their homes.</p>
<p>As in developed countries, people in poor countries hold most of their savings—their wealth—in their homes. But unlike in developed countries, weak property rights render the bulk of the savings of the world’s poor illiquid. This is not a trivial matter since the value of these frozen savings is estimated at well more than $10 trillion.</p>
<p>To try to address this issue, Western aid donors have provided billions of dollars to the governments of poor countries over the last few decades in an attempt to modernize their land registry systems, with little success. And unfortunately, there has been even less success at formalizing previously untitled property. In most countries, lawyers, career bureaucrats and professional surveyors have resisted the necessary streamlining of registration procedures, while corrupt elites have used any new land registry systems as yet another way to capture wealth for themselves.</p>
<blockquote class="pullquote right">
<p class="pq-quote"><span class="open-quote">“</span><span class="pq-body">As long as informal landholders remain isolated, fragmented, and invisible, there is little hope for meaningful reform.”</span></p>
</blockquote>
<p><strong>Little incentive for elites to change the situation</strong></p>
<p>Because the elites in poor countries obtain enormous financial and political benefits from the control they are able to exercise over the allocation of land rights, there is little incentive for them to change the situation. Taking decisions about land out of the hands of elites and turning it over to a neutral, transparent process based on the rule of law would undermine the foundation of their wealth and power. As a result, no western aid project, no matter how well-intentioned or well-funded has much chance to change the institutionalized corruption in all poor countries that creates an uneven playing field to the disadvantage of the poor.</p>
<p>As long as informal landholders remain isolated, fragmented, and invisible, there is little hope for meaningful reform. So the question, then, is how do the billions of informals in poor countries create a political reality that is more powerful than the interests of the elites? We believe that creating an open, global registry of informal rights that reflects the true consensus of neighbors and communities—not government’s arbitrary allocation of land or a registry dating back to colonial times—is the best way to trump the power of the corrupt elites and force governments to recognize the rights of their citizens.</p>
<p><strong>New technology is making claim-staking easier</strong></p>
<p>And now, the existence of relatively cheap and simple technologies—satellite maps, cell phones, the Internet, GPS and drones—allow communities around the world to stake their claims for all to see. This isn’t a new practice: obtaining secure tenure of informal holdings is described in detail in the Old Testament, while in medieval times the jury system was created for the sole purpose of settling disputes over feudal tenure. But, the new technology does make the process of claim-staking easier. GPS and satellite maps have been used to enhance property rights since their earliest availability. In the late 1990s, NGOs in Pune, India helped communities map property lines. From there it has spread to other Indian cities—including the huge Dharavi slum in Mumbai—and to tribal areas, and recently to a few places in Africa.</p>
<p><strong>How will the poor translate maps into political power sufficient to formalize their property?</strong></p>
<p>The question is: How do these poor informals translate maps into political power sufficient to formalize their property? We believe that the answer is by putting this information into informal, public registries that are not simply an individual’s claims, but the claims of an entire community. Even though the resulting registries will be informal, no developer, farming, mining or timber company will be free to simply negotiate with the corrupt central government for land concessions and claim ignorance of the current occupants. They will not only know that “someone” lives on that land, but they will have names, addresses and contact information. Consequently, the only peaceful way to develop informal holdings will be by making the occupants party to the negotiations.</p>
<p>Moreover, even a registry that is informal will begin to facilitate credit and real estate markets, quickly unlocking some of the frozen savings and allowing the poor to leverage their assets and improve their lives. As this new economy gains traction the hidden wealth it liberates and the growth it generates will demonstrate the logic of formalization to both the poor and the elites. In time the widespread benefits added to the demands of the newly empowered poor should help drive real reforms that give informal landholders the protection of the law.</p>
http://www.cato.org/publications/commentary/property-rights-poor-need-be-recognized-developing-countriesThu, 08 Jan 2015 13:13 ESTLatest Cato Research on PovertyPeter F. Schaefer, Clayton SchaeferStop Obsessing about Inequality. It's Actually Decreasing around the World.http://www.cato.org/publications/commentary/stop-obsessing-about-inequality-its-actually-decreasing-around-world
Marian L. Tupy
<p>Is inequality increasing or decreasing? The answer depends on our point of reference.</p>
<p>In America, the income gap between the top 1 percent and the rest <a href="http://www.salon.com/2014/10/26/why_income_inequality_is_americas_biggest_and_most_difficult_problem/" target="_blank">has grown</a>. But if we look not at America, but the world, inequality is shrinking. We are <a href="http://elibrary.worldbank.org/doi/book/10.1596/1813-9450-6259" target="_blank">witnessing</a>, in the words of the World Bank’s Branko Milanovic, “the first decline in global inequality between world citizens since the Industrial Revolution.”</p>
<p>For most of human history, incomes were more equal, but terribly low. Two thousand years ago, GDP per person in the most advanced parts of the world hovered around $3.50 per day. That was the <a href="http://www.ggdc.net/maddison/maddison-project/data/mpd_2013-01.xlsx" target="_blank">global average</a> 1,800 years later.</p>
<blockquote class="pullquote right">
<p class="pq-quote"><span class="open-quote">“</span><span class="pq-body">Globalization has ushered a period of unprecedented prosperity in many poor countries.”</span></p>
</blockquote>
<p>But by the early 19th century, a pronounced income gap emerged between the West and the rest. Take the United States. In 1820, the U.S. was 1.9 times richer than the global average. The <a href="http://www.ggdc.net/maddison/maddison-project/data/mpd_2013-01.xlsx%22" target="_blank">income gap grew to 4.1 in 1960</a> and reached its maximum level of 4.8 in 1999. By 2010, it had shrunk by 19 percent to 3.9.</p>
<p>That narrowing is not a function of declining Western incomes. During the Great Recession, for example, U.S. GDP per capita decreased by 4.8 percent between 2007 and 2009. It rebounded by 5.7 percent over the next 4 years and stands at an all-time high today. Rather, the narrowing of the income gap is a result of growing incomes in the rest of the world.</p>
<p>Consider the spectacular rise of Asia. In 1960, the U.S. was 11 times richer than Asia. Today, America is only 4.8 times richer than Asia.</p>
<p>To understand why, let’s look at China.</p>
<p>Between 1958 and 1961, Mao Zedong attempted to transform China’s largely agricultural economy into an industrial one through the “Great Leap Forward.” His stated goal was to overtake UK’s industrial production in 15 years. Industrialization, which included building of factories at home as well as large-scale purchases of machinery abroad, was to be paid for by food produced on collective farms.</p>
<p>But the collectivization of agriculture resulted in famine that killed between 18 and 45 million people. Industrial initiatives, such as Mao’s attempt to massively increase production of steel, were equally disastrous. People burned their houses to stoke the fires of the steel mills and melted cooking wares to fulfill the steel production quotas. The result was destruction, rather than creation of wealth.</p>
<p>Deng Xiaoping, Mao’s successor, partially privatized the farmland and allowed farmers to sell their produce. Trade liberalization ensured that Chinese industrial output would no longer be dictated by production quotas, but by the demands of the international economy. But Following liberalization in 1978, China’s GDP per capita has increased 12.5 fold, rising from $545 in 1980 to $6,807 in 2013. Over the same time period, the Chinese poverty rate fell from 84 percent to 10 percent.</p>
<p>What is true of China is also true in much of the developing world. As Laurence Chandy and Geoffrey Gertz of the Brookings Institution <a href="http://www.brookings.edu/research/interviews/2011/08/07-state-of-global-poverty-chandy" target="_blank">wrote in 2011</a>, “poverty reduction of this magnitude is unparalleled in history: never before have so many people been lifted out of poverty over such a brief period of time.”</p>
<p>Developing countries have made strides in other areas too. Take life expectancy. Between 1960 and 2010, global life expectancy increased from 53 years to 70. In the U.S. over the same period it rose from 70 to 78. Similar stories can be told about child and maternal mortality, treatment of communicable diseases, and the spread of technology.</p>
<p>Many Americans point to globalization as a bogeyman, robbing our country of good jobs and resources. But really, the phenomenon has ushered a period of unprecedented prosperity in many poor countries. Even as we struggle with economic problems at home let us remember the global – and largely positive – perspective on the state of the world.</p>
http://www.cato.org/publications/commentary/stop-obsessing-about-inequality-its-actually-decreasing-around-worldThu, 08 Jan 2015 10:08 ESTLatest Cato Research on PovertyMarian L. TupySteven Pinker on the persistence of pessimismhttp://www.cato.org/multimedia/cato-audio/steven-pinker-persistence-pessimism
http://www.cato.org/multimedia/cato-audio/steven-pinker-persistence-pessimismThu, 01 Jan 2015 15:08 ESTLatest Cato Research on PovertySteven PinkerSanctions Give Russia a Convenient Scapegoathttp://www.cato.org/multimedia/daily-podcast/sanctions-give-russia-convenient-scapegoat
Emma Ashford
<p>Sanctions aren’t meant to wreck an economy, but sometimes they contribute to an economy’s decline anyway. Emma Ashford discusses the case of Russia.</p>
http://www.cato.org/multimedia/daily-podcast/sanctions-give-russia-convenient-scapegoatMon, 22 Dec 2014 16:18 ESTLatest Cato Research on PovertyEmma AshfordSteve H. Hanke discusses economic sanctions on Russia on CCTVhttp://www.cato.org/multimedia/media-highlights-tv/steve-h-hanke-discusses-economic-sanctions-russia-cctv
http://www.cato.org/multimedia/media-highlights-tv/steve-h-hanke-discusses-economic-sanctions-russia-cctvSun, 21 Dec 2014 13:27 ESTLatest Cato Research on PovertySteve H. HankeMessage for the Pope: Caring for Poor Isn't Communist, but Advancing Statism Misguidedhttp://www.cato.org/publications/commentary/message-pope-caring-poor-isnt-communist-advancing-statism-misguided
Daniel J. Mitchell
<p>I’ve always objected when leftists engage in moral preening about how they supposedly are more compassionate.</p>
<p>Europeans statists, for instance, claim to be more compassionate because their governments have <a href="https://danieljmitchell.wordpress.com/2014/01/18/mirror-mirror-on-the-wall-which-nation-has-increased-welfare-spending-the-fastest-of-all/" target="_blank">greater levels of coercive redistribution</a>. But I ask them why they think it’s compassionate to give away other people’s money. Then I shame them by showing data on how <a href="https://danieljmitchell.wordpress.com/2013/08/01/americans-are-far-more-compassionate-than-socially-conscious-europeans/" target="_blank">Americans are far more generous</a> in terms of trying to help others with their own money.</p>
<p>I have the same debate in America. Take the issues of unemployment benefits. My leftist friends say that compassionate people should favor extended benefits. To which I reply by asking them why it’s good to pay people to not work and assert instead that <a href="https://danieljmitchell.wordpress.com/2014/01/10/to-be-genuinely-compassionate-politicians-should-focus-on-job-creation-not-unemployment-benefits/" target="_blank">genuine compassion should be defined</a> by policies that enable people to find jobs and become self-reliant.</p>
<p>I raise this topic because the Pope recently made news by urging more compassion for the less fortunate, and he specifically said that raising the issue will lead some to think he’s a communist.</p>
<blockquote class="pullquote right">
<p class="pq-quote"><span class="open-quote">“</span><span class="pq-body"> If you want to help the poor, push for economic growth rather than redistribution.”</span></p>
</blockquote>
<p>Here are some excerpts from <a href="http://www.independent.co.uk/news/world/europe/pope-francis-caring-for-the-poor-does-not-make-you-a-communist-9828856.html" target="_blank">a news report</a> in the U.K.-based <em>Independent</em>.</p>
<p>In one of his longest speeches as Pope, the Holy See outlined his views on a wide range of issues – from poverty and the injustices of unemployment to the need to protect the environment. Anticipating how his letter would be received by his critics, Francis declared that “land, housing and work are increasingly unavailable to the majority’ of the world’s population,” but said “If I talk about this, some will think that the Pope is communist.” “They don’t understand that love for the poor is at the centre of the Gospel,” he said. “Demanding this isn’t unusual, it’s the social doctrine of the church.”</p>
<p>Several people have asked my opinion about what the Pope said.</p>
<p>My initial instinct was to be very critical. After all, various news reports interpreted the Pope’s statement as <a href="https://danieljmitchell.wordpress.com/2013/12/01/the-pope-is-wrong-about-capitalism-free-markets-are-best-for-the-less-fortunate/" target="_blank">an attack on capitalism</a>and an embrace of the welfare state.</p>
<p>But since I know that the establishment media is biased and would want to portray the Pope’s comments as being supportive of statism, I didn’t want to make any unwarranted assumptions. So, I tracked down <a href="http://w2.vatican.va/content/francesco/es/speeches/2014/october/documents/papa-francesco_20141028_incontro-mondiale-movimenti-popolari.html" target="_blank">a transcript</a> of the speech. That’s the good news. The bad news is that it’s <a href="http://w2.vatican.va/content/francesco/es/speeches/2014/october/index.html#speeches" target="_blank">only available</a> (at least as of this writing) in Portuguese, Spanish, Italian, and French.</p>
<p>But with <a href="https://translate.google.com/" target="_blank">the help of Google Translate</a>, I looked at what the Pope actually said. And if the translation software is accurate, I can now offer my opinion about the Pope’s views: To be succinct, I have no idea what he thinks. And if you want me to elaborate, all I can say is that he calls for lots of action to help the poor, but he doesn’t endorse government coercion to make it happen</p>
<p>On the other hand, he doesn’t say that government shouldn’t be involved. And the tone of the speech certainly seems left wing, but that may simply be a result of me hearing a lot of statists making similar remarks and then calling for government-coerced redistribution policies.</p>
<p>The bottom line, as I suggested above, is that the Pope may be wrong, or he may be right. Which seems inconsistent but accurate. After all, the Vatican sometimes <a href="http://danieljmitchell.wordpress.com/2011/08/31/lets-send-obama-to-the-vatican-for-an-economics-lesson/" target="_blank">has been very good</a> on economic issues and <a href="http://danieljmitchell.wordpress.com/2011/10/24/the-vatican-should-try-to-save-souls-not-ruin-economies/" target="_blank">at times very disappointing</a>.</p>
<p>But I will say something definitive. If anybody, including the Pope, thinks that bigger government is the way to help the poor, they are very misguided.</p>
<p>I’ve already <a href="https://danieljmitchell.wordpress.com/2011/09/13/dramatic-increase-in-poverty-rate-one-small-step-for-obama-one-giant-step-for-the-so-called-war-on-poverty/" target="_blank">shared some powerful data</a> to show that poverty was falling in America after World War II, but then the progress came to a halt once the federal government launched a “War on Poverty” and dramatically expanded the welfare state.</p>
<p>Let’s augment that data today with a specific look at what happened when the federal government decided to “help” folks in Appalachia. Here are some excerpts from a very compelling <em>National Review</em> <a href="http://www.nationalreview.com/article/388854/consigned-assistance-j-d-vance" target="_blank">column</a>.</p>
<p>“Appalachian whites suffer from many of the same social ills as working-class blacks: broken families, substance abuse, poor health, and high poverty. …Early anti-poverty efforts focused largely on the white population. …It was, as Ira Katznelson argued in an explosive book, a type of affirmative action — for white people. …Two federally chartered organizations — the Depression-era Tennessee Valley Authority (TVA) and Johnson’s Appalachian Regional Commission (ARC) — pumped millions of development dollars into predominantly white rural locales. …The aid came not just in the form of direct welfare payments, but also as government jobs. The country-music anthem “Song of the South” tells a familiar tale: “Papa got a job with the TVA; we bought a washing machine and then a Chevrolet.” …From 1965 until 1981, when the federal government began to scrutinize the cash flowing to Appalachia, federal appropriation to the ARC exceeded $1 billion (in today’s dollars) every single year. Even today, Congress sends about $80 million to the ARC; no other regionally focused entity spends more. As late as 2000, Appalachians received more federal money per capita than average, despite their minimal cost of living and the low number of federal employees in the region.”</p>
<p>So, has all this federal largesse helped?</p>
<p>Well, not exactly.</p>
<p>“…there are now precious few jobs in Tennessee valleys and too few drivers on those wide mountain roads. If Papa bought a washing machine and then a Chevrolet, Junior is buying oxy or meth: West Virginia leads the nation in drug-overdose deaths, with Kentucky third and Tennessee eighth. …Today, the inheritors of Katznelson’s affirmative action for whites occupy the lowest rungs of the socioeconomic ladder. West Virginia, Kentucky, northern Georgia, and South Carolina all nabbed more than their fair share of federal aid, but now they are among the poorest parts of the country. …Residents of these states suffer the worst consequences. In many Appalachian counties, inhabitants can expect to live only 67 years, more than a decade less than the average American. …Alongside the grim statistics is a spiritual poverty more difficult to measure but easier to see. There’s the high-school teacher who has only once had a class without a pregnant student. …Young students in eastern Kentucky sometimes tell their teachers that they hope to “draw” when they grow up. But they’re not talking about a career as an artist; they’re talking about drawing a government check. These kids weren’t programmed like that at birth; they were taught something destructive by their communities.”</p>
<p>There are some lessons to be learned.</p>
<p>“…the failure of the effort gives us ample reason to question the wisdom of federally led development efforts no matter the intended beneficiaries. Government cannot create a sustainable economy, no matter how hard it tries. And traditional welfare, while defensible as a way of alleviating immediate deprivation, too often fails to place people on the road to self-sufficiency. …encouraging family stability — or at least not discouraging it through the tax code or needless incarceration — promotes upward mobility more effectively than transfer payments…if the failures of Appalachia are any guide, a narrower policy agenda might actually serve the poor — white and black alike.”</p>
<p>Amen. If you want to help the poor, <a href="https://danieljmitchell.wordpress.com/2013/11/14/economic-growth-is-the-best-way-to-help-the-poor-not-redistribution-in-pursuit-of-coerced-income-equality/" target="_blank">push for economic growth</a> rather than redistribution.</p>
<p>There are even some honest liberals who <a href="http://danieljmitchell.wordpress.com/2012/12/10/an-honest-liberal-confronts-the-problem-of-government-dependency/" target="_blank">now admit</a> that big government promotes long-run dependency.</p>
http://www.cato.org/publications/commentary/message-pope-caring-poor-isnt-communist-advancing-statism-misguidedThu, 06 Nov 2014 08:36 ESTLatest Cato Research on PovertyDaniel J. MitchellMichael D. Tanner's research on poverty is cited on FBN's Making Money with Charles Paynehttp://www.cato.org/multimedia/media-highlights-tv/michael-d-tanners-research-poverty-cited-fbns-making-money-charles
http://www.cato.org/multimedia/media-highlights-tv/michael-d-tanners-research-poverty-cited-fbns-making-money-charlesTue, 28 Oct 2014 12:18 EDTLatest Cato Research on PovertyMichael D. TannerMichael D. Tanner discusses the War on Poverty on KHOW's The Mandy Connell showhttp://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-war-poverty-khows-mandy-connell-show
http://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-war-poverty-khows-mandy-connell-showMon, 27 Oct 2014 11:51 EDTLatest Cato Research on PovertyMichael D. TannerMichael D. Tanner discusses his recent paper, "War on Poverty Turns 50: Are We Winning Yet?", on WWL's The Think Tank with Garland Robinettehttp://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-recent-paper-war-poverty-turns-50-are
http://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-recent-paper-war-poverty-turns-50-areTue, 21 Oct 2014 12:30 EDTLatest Cato Research on PovertyMichael D. TannerWar on Poverty Turns 50: Are We Winning Yet?http://www.cato.org/publications/policy-analysis/war-poverty-turns-50-are-we-winning-yet
Michael D. Tanner, Charles Hughes
<p>The War on Poverty is 50 years old. Over that time, federal and state governments have spent more than $19 trillion fighting poverty. But what have we really accomplished?</p>
<p>Although far from conclusive, the evidence suggests that we have successfully reduced many of the deprivations of material poverty, especially in the early years of the War on Poverty. However, these efforts were more successful among socioeconomically stable groups such as the elderly than low-income groups facing other social problems. Moreover, other factors like the passage of the Civil Rights Act, the expansion of economic opportunities to African Americans and women, increased private charity, and general economic growth may all have played a role in whatever poverty reduction occurred.</p>
<p>However, even if the War on Poverty achieved some initial success, the programs it spawned have long since reached a point of diminishing returns. In recent years we have spent more and more money on more and more programs, while realizing few, if any, additional gains. More important, the War on Poverty has failed to make those living in poverty independent or increase economic mobility among the poor and children. We may have made the lives of the poor less uncomfortable, but we have failed to truly lift people out of poverty.</p>
<p>The failures of the War on Poverty should serve as an object lesson for policymakers today. Good intentions are not enough. We should not continue to throw money at failed programs in the name of compassion.</p>
<hr />
<p><strong>Save the Date:</strong> On January 29, 2015, Cato is having <a href="http://www.cato.org/events/50-years-war-poverty-success-failure-or-incomplete">a special half-day conference</a> at Columbia University to discuss whether the War on Poverty succeeded in reducing poverty in the United States, what remains to be done, and whether private charitable efforts would be a better alternative to government welfare programs.</p>
http://www.cato.org/publications/policy-analysis/war-poverty-turns-50-are-we-winning-yetMon, 20 Oct 2014 (All day)Latest Cato Research on PovertyMichael D. Tanner, Charles HughesPope Francis' Admirable War on Povertyhttp://www.cato.org/publications/commentary/pope-francis-admirable-war-poverty
Nat Hentoff
<p>I am an atheist, but have never wavered in my conviction that persons with religious beliefs are entitled to the same freedom of choice as me. And in my vocation as a reporter, the person who has most influenced me was the late Frances Sweeney, a deeply religious Catholic editor of a penetratingly independent Boston newspaper where I first became a journalist in my teens.</p>
<p>Boston was then the most anti-Semitic city in the country, and in the Jewish ghetto where I grew up, boys knew if they walked alone down those streets at night, they could lose teeth from invading avengers of Christ’s death. I even lost some teeth.</p>
<p>Yet Frances Sweeney, in her newspaper and in public meetings, persistently criticized the city’s Catholic leadership for its continued silence on this bigotry. Threatened once with excommunication by Cardinal William O’Connell for her attacks, she nonetheless persisted in her criticism.</p>
<p>I was one of those teenage reporters who exposed some of the financiers of that anti-Semitism in her newspaper.</p>
<p>So I now have no hesitation, though still an atheist, in being drawn to a Catholic Church that, according to Pope Francis, “is poor and for the poor.”</p>
<p>In his first Apostolic Exhortation, <em>Evangelii Gaudium</em> (The Joy of the Gospel), presented last November, Pope Francis wrote: “Our faith in Christ, who became poor, and was always close to the poor and the outcast, is the basis of our concern for the integral development of society’s most neglected members …</p>
<p>“It means working to eliminate the structural causes of poverty and to promote the integral development of the poor, as well as small daily acts of solidarity in meeting the real needs which we encounter.”</p>
<p>Then, a Pope Francis advance: “It presumes the creation of a new mindset which thinks in terms of community and the priority of the life of all over the appropriation of goods by a few … This means education, access to health care, and above all, employment, for it is through free, creative, participatory and mutually supportive labour that human beings express and enhance the dignity of their lives.”</p>
<p>And dig this: “A just wage enables them to have adequate access to all the other goods which are destined for our common use.”</p>
<p>Lest you think Pope Francis was focusing solely on secular changes, he emphasized: “For the Church, the option for the poor is primarily a theological category rather than a cultural, sociological, political or philosophical one.</p>
<p>“God shows the poor ‘his first mercy.’ This divine preference has consequences for the faith life of all Christians, since we are called to have ‘this mind … which was in Jesus Christ’ …</p>
<p>“Inspired by this, the Church has made an option for the poor which is understood as a ‘special form of primacy in the exercise of Christian charity, to which the whole tradition of the Church bears witness’ …</p>
<p>“This is why I want a Church which is poor and for the poor. They have much to teach us. Not only do they share in the sensus fidei (sense of the faith), but in their difficulties they know the suffering Christ. We need to let ourselves be evangelized by them.”</p>
<p>Then, a challenge administered by Pope Francis. How many of you — of all backgrounds — agree with this?</p>
<p>Said Francis: “Growth in justice requires more than economic growth, while presupposing such growth: it requires decisions, programmes, mechanisms and processes specifically geared to a better distribution of income, the creation of sources of employment and an integral promotion of the poor which goes beyond a simple welfare mentality …</p>
<p>“Let us not leave in our wake a swath of destruction and death which will affect our own lives and those of future generations.”</p>
<p>To further illuminate some of Pope Francis’ global war on poverty, here are some facts about poverty in the United States:</p>
<p>“In 2013, the official poverty rate was 14.5 percent … There were 45.3 million people in poverty” (census.gov).</p>
<p>“More than 16 million children in the United States — 22 percent of all children — live in families with incomes below the federal poverty level — $23,550 a year for a family of four. Research shows that, on average, families need an income of about twice that level to cover basic expenses. Using this standard, 45 percent of children live in low-income families.</p>
<p>“Most of these children have parents who work, but low wages and unstable employment leave their families struggling to make ends meet” (National Center for Children in Poverty, nccp.org).</p>
<p>And, as if you didn’t know: “Poverty can impede children’s ability to learn and contribute to social, emotional and behavior problems.</p>
<p>“Poverty also can contribute to poor health and mental health. Risks are greatest for children who experience poverty when they are young and/or experience deep and persistent poverty.</p>
<p>“Research is clear that poverty is the single greatest threat to children’s well-being. But effective public policies — to make work pay for low-income parents and to provide high-quality early care and learning experiences for their children — can make a difference. Investments in the most vulnerable children are also critical” (nccp.org).</p>
<p>During this year’s midterm elections, and, of course, the all-encompassing 2016 elections, look and see how many candidates have anything specific and meaningful to propose about our poverty across the board.</p>
<p>I’d also be interested in how many refer to Pope Francis on this crucial subject. One doesn’t have to be Catholic to bring this pope into such a vital conversation about our future.</p>http://www.cato.org/publications/commentary/pope-francis-admirable-war-povertyWed, 01 Oct 2014 09:09 EDTLatest Cato Research on PovertyNat HentoffSteve H. Hanke's Misery Index is discussed on NTN24's La Tardehttp://www.cato.org/multimedia/media-highlights-tv/steve-h-hankes-misery-index-discussed-ntn24s-la-tarde
http://www.cato.org/multimedia/media-highlights-tv/steve-h-hankes-misery-index-discussed-ntn24s-la-tardeMon, 01 Sep 2014 13:27 EDTLatest Cato Research on PovertySteve H. HankeI'm Trying to Solve a Decades Old Mystery: How Many People Were Killed by China's Great Famine?http://www.cato.org/publications/commentary/im-trying-solve-decades-old-mystery-how-many-people-were-killed-chinas-great
Mao Yushi
<p>There’s a mystery in China that’s decades old: how many people died during the Great Famine?</p>
<p>It’s almost impossible to say. Some historians call it the worst man-made disaster in human history, killing one out of every eight people in some places. But much about the time period is actively suppressed in China. In fact, it’s euphemistically referred to as the “Three Years of Natural Disasters” there, and discussion remains taboo.</p>
<p>As an economist and a concerned citizen, I’ve been seeking out the truth. Not only are there important historical and economic lessons to be learned from this episode, the Chinese government’s continued censorship of the past helps perpetuate the closed, authoritarian political system there.</p>
<p>It’s also important to understand because the Great Famine was caused by avoidable human mistakes, not inescapable natural disasters.</p>
<p>The trouble began in 1949, when the Communist party took power. Soon after, Mao’s Great Leap Forward tried to modernize China’s agricultural system. But many farmers were unable to grow enough food for themselves after handing over a considerable portion to the government.</p>
<p>This led to mass starvation across the country’s countryside. At the time, I was in my early 30s and working at the Railway Research Institute. I remember that our basketball court had been transformed into a field to grow wheat.</p>
<p>Eventually, I was labeled a “rightist” and persecuted, along with thousands of others. We were removed from our posts and sent to the countryside for “re-education.” I was reduced to the lowest human form, constantly stalked by the nightmare that I could never shake: hunger.</p>
<p>There were 700 people in the small village where I stayed during this period. Roughly 80-90 died from hunger or related diseases before the famine ended in 1961.</p>
<blockquote class="pullquote right">
<p class="pq-quote"><span class="open-quote">“</span><span class="pq-body">Even to this day, most Chinese people aren’t aware of the real impacts of the Great Famine.”</span></p>
</blockquote>
<p>Even to this day, most Chinese people aren’t aware of the real impacts of the Great Famine. Researchers debate the number of people killed, estimating it’s anywhere from 18 million to more than 42 million. The official Chinese government estimate hovers around 20 million.</p>
<p>I’ve been investigating the question. According to the Chinese government’s own statistical yearbook, the population of China was growing continuously until the end of 1958. If we follow this line of growth, the population should have been 711.18 million by 1962, instead of 658.59 million, a difference of about 52 million individuals.</p>
<p>We cannot, however, simply say the Great Leap Forward killed 52 million people. Though millions starved to death, that number also accounts for females who did not give birth, and babies that were never born. If we subtract the would-be newborns, given the average mortality and fertility rates of the period, the number of unnatural deaths during the Great Famine was 36 million.</p>
<p>If this is right, the Great Famine killed about as many people as the Second World War. It is the equivalent of a Nanjing Massacre in every one of China’s 30 provincial capitals five times over.</p>
<p>“The Chinese people were cheated,” Jo Lusby, head of China operations for Penguin, told the <em>Guardian</em>. “They need real history.” That is my quest — to answer the questions we don’t always know to ask.</p>
http://www.cato.org/publications/commentary/im-trying-solve-decades-old-mystery-how-many-people-were-killed-chinas-greatMon, 01 Sep 2014 11:12 EDTLatest Cato Research on PovertyMao YushiMisallocation, Property Rights, and Access to Finance: Evidence from within and across Africahttp://www.cato.org/publications/research-briefs-economic-policy/misallocation-property-rights-access-finance
Sebnem Kalemli-Ozcan, Bent E. Sørensen
<p>A number of recent studies argue that misallocation of resources across firms is a prime cause of underdevelopment. Standard theory implies that if capital markets function well, at each firm the “marginal product of capital” (the extra output produced by an additional unit of capital) should equal the market interest rate. This is because the interest rate is the cost of acquiring funds to invest. If extra capital can generate a higher return (more output per unit of added capital) than the cost of funds, the firm should add capital, which moves the return downward toward the interest rate. Likewise, if the interest rate exceeds the return from more capital, the firm should disinvest capital, which raises the return on its remaining capital.</p>
<p>Thus, when the marginal return from capital and the interest rate differ, the firm is not making an efficient choice about how much capital to utilize.</p>
<p>A key implication is that if firms borrow at different interest rates, they cannot all have adjusted their capital investments so that the marginal return equals this rate. This might reflect differential access to informal finance or differences in political connections. Capital is therefore likely to be misallocated across firms.</p>
<p>Alfaro, Charlton, and Kanczuk (2008); Banerjee and Duflo (2004); Bartelsman, Haltiwanger, and Scarpetta (2009); Hsieh and Klenow (2009); and Restuccia and Rogerson (2008) provide evidence of capital misallocation in different countries and show that this can explain up to 60 percent of the aggregate differences in productivity between poor and rich countries.</p>
<p>On the basis of this framework, we ask two questions: what is the extent of capital misallocation within African countries, and why does misallocation vary across these countries? We quantify capital misallocation across manufacturing establishments within 10 African countries in 2005 and 2006 using establishment-level data from the World Bank Productivity and Investment Climate Survey. This is a unique survey undertaken as part of a major World Bank initiative between 1999 and 2007 in 80 developed and developing countries around the world.</p>
<p>The main purpose of the survey is to identify obstacles to firm performance and growth; hence the survey not only asks questions on firm characteristics and outcomes but also on the perceived severity of obstacles such as crime, infrastructure, and financing constraints. Having firms’ own perceptions of financing constraints is a big advantage because much of the literature infers financing constraints from companies’ financial statements using various modeling and econometric techniques; this approach requires strong assumptions that may not hold in the data, thus biasing results.</p>
<p>This data set has been used by, among others, Beck, Demirgüç-Kunt, Laeven, and Maksimovic (2006) and Beck, Demirguüç-Kunt, and Maksimovic (2005), who show that self-perceived constraints actually bind and hurt firm growth. Our data set has information on small and large, as well as listed and private firms, which allows us to control for some important firm characteristics. To the best of our knowledge, no systematic study calculates the extent of misallocation and its determinants for Africa using comparable firm-level data.</p>
<p>The existing literature uses various approaches to calculate the extent of capital misallocation across firms within a country. As stated above, one advantage of our data set is that we can compare the interest rates firms are paying with market interest rates. This is our starting point because we have data on the interest rates each firm pays on loans. We show that many firms borrow at rates up to 30–40 percent, which suggests that firms have even higher marginal returns to capital.</p>
<p>We calculate capital productivity for each firm using firm-level output and capital stocks under plausible assumptions about the production function (the relation between input used and output produced). Doing so reveals that the distribution of capital productivity varies considerably within most African countries. This indicates that capital is inefficiently allocated — a fact that cannot be derived from country-level aggregate figures. We also calculate a measure of misallocation suggested by Hsieh and Klenow (2009), which again indicates imperfect capital and/or labor allocation.</p>
<p>As a check on our approach, we compare the statistics calculated for African countries to corresponding statistics calculated for a selection of non-African countries at different levels of development; namely, Germany, Ireland, Spain, South Korea, and India. This comparison reveals that the variation across firms of our misallocation measures is much larger in Africa. For example, the variability of the interest rate is 2–5 times higher in African countries than in European countries, and the variability of capital productivity is about 40 percent higher in African countries (and in India) than in European countries. More than 50 percent of firms in Africa report that access to finance is a severe obstacle, while very few firms in Europe report this as a severe obstacle.</p>
<p>We show that firms with less access to finance have higher capital productivity. Small firms have lower capital productivity, conditional on access to finance and other variables, which suggests that higher efficiency could be attained by allocating more capital to large firms. Comparing a firm where access to finance is no obstacle to a firm where access to finance is a severe obstacle, capital productivity is 45 percent higher, revealing that obstacles to credit have substantial real effects.</p>
<p>Having calculated and confirmed the extent of misallocation, we seek to explain firm-level differences in the return to capital within countries and the variation in misallocation across countries. We find that across countries, misallocation is lower when property rights are stronger, where we measure property rights using expropriation risk and investment profile variables from the International Country Risk Guide. These variables help explain the variation in misallocation across African countries, consistent with the patterns found by Johnson, McMillan, and Woodruff (2002) for former communist countries.</p>
<p>Hence, we contribute to the recent debate on “what works in Africa?” in the following sense. Once we calculate the extent of misallocation using different methodologies, we can explain the determinants of this misallocation at the firm level and relate country variation in misallocation to the broader policy, investment, and business environments. This, in turn, helps explain why certain countries have better allocation of capital across firms. That is, we can identify relatively successful countries, such as South Africa and Botswana, relative to unsuccessful ones, such as Ghana and Nigeria, and suggest reasons behind their success. The results point to the importance of strong property rights and a well functioning financial system for the efficient allocation of capital.</p>
<p><strong>NOTE</strong>:<br />
This Research Brief is based on Sebnem Kalemli-Ozcan and Sorensen (2014), <a href="http://papers.nber.org/books/afri14-3" target="_blank">http://papers.nber.org/books/afri14-3</a>.</p>
http://www.cato.org/publications/research-briefs-economic-policy/misallocation-property-rights-access-financeWed, 06 Aug 2014 03:07 EDTLatest Cato Research on PovertySebnem Kalemli-Ozcan, Bent E. SørensenMichael D. Tanner discusses the latest plan to fight poverty on WWL's Think Tank with Garland Robinettehttp://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-latest-plan-fight-poverty-wwls-think
http://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-latest-plan-fight-poverty-wwls-thinkTue, 29 Jul 2014 14:41 EDTLatest Cato Research on PovertyMichael D. TannerMichael D. Tanner discusses the drop in food stamp enrollment on NPR's All Things Consideredhttp://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-drop-food-stamp-enrollment-nprs-all
http://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-drop-food-stamp-enrollment-nprs-allThu, 29 May 2014 11:58 EDTLatest Cato Research on PovertyMichael D. Tanner"The Tyranny of Experts" Part 2http://www.cato.org/multimedia/cato-video/tyranny-experts-part-2
William Easterly
<p>Follow the link below to watch the full event:<br>
<a href="http://www.cato.org/multimedia/events/tyranny-experts-economists-dictators-forgotten-rights-poor" rel="nofollow" dir="ltr">http://www.cato.org/multimedia/events/tyranny-experts-economists-dictators-forgotten-rights-poor</a></p>
<p>Featuring the author William Easterly; Professor of Economics, New York University; moderated by Ian Vasquez, Director, Center for Global Liberty and Prosperity, Cato Institute.</p>
<p>The technocratic approach to ending global poverty favored by development experts often strengthens authoritarian governments and neglects or undermines the preferences and personal choices of poor people. William Easterly will explain why a different branch of economics emerged for poor countries and how it has served the interests of decisionmakers in powerful countries, political leaders in poor countries, and humanitarians in rich countries. Join us to hear Professor Easterly make a case in favor of liberty that has so far been disregarded by the experts: poverty can only be ended and development sustained by respecting the individual rights of the world’s poor.</p>
<p>Video produced by Blair Gwaltney.</p>http://www.cato.org/multimedia/cato-video/tyranny-experts-part-2Sun, 11 May 2014 08:22 EDTLatest Cato Research on PovertyWilliam Easterly"The Tyranny of Experts" Part 1http://www.cato.org/multimedia/cato-video/tyranny-experts-part-1
William Easterly
<p>Follow the link below to watch the full event:<br>
<a href="http://www.cato.org/multimedia/events/tyranny-experts-economists-dictators-forgotten-rights-poor" rel="nofollow" dir="ltr">http://www.cato.org/multimedia/events/tyranny-experts-economists-dictators-forgotten-rights-poor</a></p>
<p>Featuring the author William Easterly; Professor of Economics, New York University; moderated by Ian Vasquez, Director, Center for Global Liberty and Prosperity, Cato Institute.</p>
<p>The technocratic approach to ending global poverty favored by development experts often strengthens authoritarian governments and neglects or undermines the preferences and personal choices of poor people. William Easterly will explain why a different branch of economics emerged for poor countries and how it has served the interests of decisionmakers in powerful countries, political leaders in poor countries, and humanitarians in rich countries. Join us to hear Professor Easterly make a case in favor of liberty that has so far been disregarded by the experts: poverty can only be ended and development sustained by respecting the individual rights of the world’s poor.</p>
<p>Video produced by Blair Gwaltney.</p>http://www.cato.org/multimedia/cato-video/tyranny-experts-part-1Sun, 11 May 2014 08:12 EDTLatest Cato Research on PovertyWilliam EasterlyNigeria's Internal Insecurity Statehttp://www.cato.org/publications/commentary/nigerias-internal-insecurity-state
Doug Bandow
<p>Abuja, Nigeria—Like so many developing states, Nigeria showcases poverty while exhibiting potential. People are entrepreneurial but the state is exploitative. Wealth is made but too often stolen. Evidence of security—which really means insecurity—is everywhere.</p>
<p>Americans also suffer from crime, of course. But most of us fly around the country without giving the matter much thought. We hop into our cars without a bodyguard joining us. There are areas a smart traveler wouldn’t go. But most folks in the U.S. rarely imagine the potential of a daylight robbery or kidnapping.</p>
<p>Not so in Nigeria, however. I traveled with a journalist group on a business tour. We were met by representatives of the organizer, along with a driver and two national policemen armed with AK-47s. When we convoyed with figures of business or political note the guard multiplied dramatically.</p>
<blockquote class="pullquote right">
<p class="pq-quote"><span class="open-quote">“</span><span class="pq-body">Nigeria’s security problems underscore the country’s extraordinary unmet potential.”</span></p>
</blockquote>
<p>All of my hotels around the country—Abuja, Lagos, Port Harcourt—had metal detectors. High walls and gates manned by armed security personnel. And multiple security guards, at the entrance, wandering the grounds, and even stationed by the elevators on each floor overnight.</p>
<p>Nevertheless, Abuja, as the seat of government, is relatively safe. Former Gov. Orji Uzor Kalu, a successful businessman considering a presidential run, complained that “without a police escort you can’t move” in much of the country: “You can move in Abuja, maybe some parts of Lagos, but you cannot move elsewhere.”</p>
<p>Security checkpoints on major roads were common as we traveled outside of major cities. It wasn’t clear what the cops were looking for and they didn’t pull many people over. But our armed escort helped us pass around the long lines of autos. </p>
<p>While trapped in traffic just a few hundred yards away from our hotel in Port Harcourt, which acts a bit like Nigeria’s Houston, given the heavy oil industry presence, we suggested walking to our destination. Too dangerous, we were informed. Energy companies never allow their employees to go anywhere without an armed escort. Every major firm employs armed guards at their facilities. </p>
<p>In fact, the Niger Delta, host to manifold energy and maritime operations, is particularly risky. Residents resent northern domination and perceive that, as one businessman put it, money being extracted from the ground and water isn’t going to the local people. These attitudes have prompted violence ranging from kidnappings of foreigners to attacks on facilities and ships. </p>
<p>Being careful isn’t enough. Nor is hiring protective personnel. Company officials privately acknowledge more directly buying protection, spreading cash throughout local communities. The government runs a Joint Task Force, including the military and other security-oriented agencies, to confront violence from militants. An executive at one local firm said the situation is better than a few years ago, but extremists still must be paid off to avoid attacks.</p>
<p>The smart outsider makes sure he has a well-armed friend or two. A sign on the door leading from the pool to the hotel proclaimed: “All Escorts Terminate Here. Fire Arms Are Prohibited In This Facility.” In back of the pool another sign sounded even more threatening: “Emergency Assembly Muster Point.” Apparently there are contingency plans if something goes wrong.</p>
<p>Nigeria has had its share of conflict—four decades ago the central government brutally suppressed the attempted secession of the eastern region as the state of Biafra, resulting in anywhere between one and three million dead. More recently ruthless military dictators ruled. Today the greatest problem may be internal divisions within the population of about 175 million divided into roughly 500 ethnic groups. The country is almost evenly divided between Christian and Muslim, leading to complicated political bargaining. Recently the terrorist group Boko Haram has been slaughtering Christians and moderate Muslims.</p>
<p>The country already suffers from the usual Third World maladies of the over-politicized state. Like many other nations, Abuja inherited dirigiste policies from the colonial era which were expanded by exploitative elites after independence. Bureaucracy is pervasive and corruption is rife. One expatriate worker observed: “Nigeria is not a country. It is an opportunity.” Pay-offs are a way of life, despite increased efforts to challenge the practice.</p>
<p>These economic disincentives are greatly exacerbated by problems of insecurity. A publishing executive complained that it was dangerous to send trucks out at night to deliver the next day’s newspapers. The company hopes to establish more satellite plants to cover the nation.</p>
<p>Investment requires not just legal protection but physical protection. That adds to the cost of doing business. A potential investor or trader cannot move freely as in the U.S., Europe, or leading East Asian states. Expatriate employees much watch their backs. And the costs roll down to indigenous peoples, who lose when investment and trade opportunities are limited.</p>
<p>Kalu, who is considering a presidential run, emphasized the need for deregulation and privatization and professed his admiration of Ronald Reagan. He also highlighted the problems of corruption and energy for his oil-rich nation, where bribes are expected and power outages are constant. But he suggested that the lack of personal safety is even more basic. During a recent interview in Abuja he noted that “internal security is crucial.” Without security, he said, “I don’t know how we can develop. We need internal security so citizens and non-citizens can move more freely.”</p>
<p>Nigeria’s security problems underscore the country’s extraordinary unmet potential. It has Africa’s largest population and Nigeria’s GDP will soon surpass that of South Africa. Nigeria’s energy reserves are an envy of the continent.</p>
<p>Moreover, the Nigerian people exhibit both hard work and entrepreneurship. Perhaps the most striking feature of the Nigerian landscape is the pervasive enterprising spirit of Nigerians. People are everywhere on the move, hawking products. Stalls dot even the most isolated roads while markets appear wherever one travels. What Nigerians lack, one businessman complained to me, was an “enabling environment” from the government.</p>
<p>Which should include security, perhaps the most foundational government responsibility.</p>
<p>Nigeria has many advantages lacking in its neighbors, and other developing states. However, so much of its potential is yet untapped. Nigerians are capable of prospering. But they lack the secure, encouraging environment necessary to succeed. It is well past time for Nigeria’s leaders to put their people’s interests first.</p>
http://www.cato.org/publications/commentary/nigerias-internal-insecurity-stateFri, 28 Mar 2014 09:06 EDTLatest Cato Research on PovertyDoug BandowMichael D. Tanner discusses food stamps on WWL's The Tommy Tucker Showhttp://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-food-stamps-wwls-tommy-tucker-show
http://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-food-stamps-wwls-tommy-tucker-showTue, 11 Mar 2014 11:37 EDTLatest Cato Research on PovertyMichael D. TannerMichael D. Tanner discusses the War on Poverty on KNUS's The Sengenberger Showhttp://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-war-poverty-knuss-sengenberger-show
http://www.cato.org/multimedia/media-highlights-radio/michael-d-tanner-discusses-war-poverty-knuss-sengenberger-showSat, 08 Mar 2014 11:39 ESTLatest Cato Research on PovertyMichael D. TannerMinimum Wages: A Poor Way to Reduce Povertyhttp://www.cato.org/publications/tax-budget-bulletin/minimum-wages-poor-way-reduce-poverty
http://www.cato.org/publications/tax-budget-bulletin/minimum-wages-poor-way-reduce-povertyThu, 27 Feb 2014 15:52 ESTLatest Cato Research on PovertyJoseph J. Sabia